ACIT 1(2)(1), MUMBAI vs. CITIZEN CREDIT CO OPERATIVE BANK LTD, MUMBAI

The present Appeal has been filed by the revenue against the order of Commissioner of Income Tax (Appeals)-2, Mumbai, dated 03.07.17 for AY 2011-12 on the grounds mentioned herein below:-

As per the facts of the present case, the return of income was filed by the assessee on 28.09.11 declaring total income at M/s Citizen Credit Co-Operative Bank Ltd. Rs. 24,91,05,830/-. Subsequently, the case was selected for scrutiny and after serving statutory notice and seeking reply of the assessee, assessment order u/s. 143(3)dated 21.11.2013 was passed by the AO, thereby an amount of Rs. 2,20,99,000/- was added to the total income of the assessee.

Aggrieved by the order of AO, assessee preferred appeal before Ld. CIT(A) and Ld. CIT(A) after considering the case of both the parties allowed the appeal of the assessee.

Aggrieved by the order of Ld. CIT(A), revenue has filed the present appeal before us on the grounds mentioned herein above.

We have heard the counsels for both the parties at length and we have also perused the material placed on record as well as the orders passed by revenue authorities. Before we decide the merits of the case, it is necessary to evaluate the orders passed by Ld. CIT(A). The Ld. CIT(A) has dealt with the above grounds raised by the revenue in para no. 3 of its order and the same is reproduced below:-

After having gone through the facts of the present case and hearing the parties at length, we find that initially AO and Ld. CIT(A) in the first round of litigation had disallowed the claim of the assessee on the premise that no revised return was filed by the assessee. Whereas assessee had explained by submitting M/s Citizen Credit Co-Operative Bank Ltd. detailed computation of special reserve deduction, which was audited by statutory auditors of the bank and thus submitted that assessee was eligible for the deduction u/s 36(1)(viii) of the Act. It was argued that similar claim was also accepted by CPC in subsequent years and thus the Tribunal while considering the said facts, had restored the matter back to the file of First Appellate Authority for fresh adjudication. It is true that Ld. CIT(A) had not passed well reasoned speaking order, but the fact remains that the assessee had submitted detailed explanation alongwith computation of special reserve alonwith the statutory auditor’s report. Even similar claim has already been accepted by CPC, thus considering the above facts, we feel there are no reasons to stretch the claim of the assessee any further.

Even otherewise, Hon’ble supreme Court in the case of Bharat Samachar Nigam Ltd. Vrs. UOI (2006) 282 ITR 273 (SC) had held that the rule of consistency may be followed, wherein it was said “Each assessment year being a unit, what is decided in one year may not apply in the following year but where a fundamental aspect permeating through the different M/s Citizen Credit Co-Operative Bank Ltd. assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent year.”

We also noticed that in the subsequent years, order u/s 143(3) of the Act had already been passed in favour of the assessee, which also support the stand taken by the assesse and therefore, Ld. CIT(A) while appreciating the facts of the present case had rightly allowed the appeal of the assessee.

Moreover, no new facts or contrary judgments have been brought on record before us in order to controvert or rebut the findings so recorded by Ld CIT (A). Therefore, there are no reasons for us to interfere into or deviate from the findings recorded by the Ld. CIT (A). Hence, we are of the considered view that the findings so recorded by the Ld. CIT (A) are judicious and are well reasoned. Resultantly, these grounds raised by the revenue stands dismissed.